The Ramsey Show - App - Amputate the Tesla! (Hour 2)

Episode Date: February 17, 2023

Jade Warshaw & Rachel Cruze answer your questions and discuss: "I want a new job but I can't lose my insurance", Saving for a new home vs. paying down the current house", Random Acts of Kindness Day, "Should I pay cash for my next car?" Pausing investing to pay off debt, "I co-signed on a car loan for my son"  from the blog: The Truth About Debt and Relationships Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET Want a plan for your money? Take our FREE 3 minute assessment: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

🎵 Live from the headquarters of Ramsey Solutions, broadcasting from the Pods Moving and Storage Studio, it's The Ramsey Show, where we help people build wealth. We help you do work that you love and create actual amazing relationships. I'm your host, Jade Warshaw, joined by Rachel Cruz. Give us a call today. We want to talk about whatever it is that's on your mind, whatever it is that's been bugging you, trying to make a decision.

We want to help you. The number is 888-825-5225. And let's go directly to the phone lines. We've got Steven on the line. Steven's in Austin, Texas. How can we help you today, Steven? Well, first of all, thank you for taking my call. I'm listening to your folks.

I believe you guys are awesome. You're very welcome. What I want to say is... Hey, are you in a place where you can kind of dial it back I just heard a little something there yeah I'm at my job right now

but anyway I'm in that corner of the job here and that's kind of why I had to get dialed out of the way okay how can we help today? Well, I want to move to a different position where I've had prior experience and has the potential to make a lot more lucrative career. And the place right now where I work is a big box home improvement store.

And this place, they have the benefits here. So they are able to have my health insurance, which takes care of my medications that I take every day or every month, which the medications are up around 10 grand a month. Gosh, what's the health issue, Steve? Yeah. Steven, what's going on? Epilepsy. Oh, I'm so sorry.

Yeah, and the biggest part of all this is me not being able to drive back and forth to work. No, I have to have my wife drive me. Right now, my father-in-law, he's down here. He does it too. But your health insurance is covering the cost of your medication for that at this point? Exactly.

My wife's so scared of me trying to find another job because we'll be losing my insurance. And I came up with a plan here. It may sound a little crazy, but if I can get, I have, you know, a bunch of vacation days I can use get two or three months worth of medicine stocked up, go and find these different job offers and interviews that have been asked of me to go do. I can do that. So you've got a list of prospects. You've got a list of jobs that you're interested in, that you're interested in applying for. And they're interested in me coming to them.

Yeah, that's great. Yeah. So, yes. So, yeah, Stephen, you could use some vacation days for that. Or if you have an interview in the afternoon, maybe it's if it's are you on on an hourly pay right now yes i'm on the hourly pay okay so yeah so even if you had to take off an afternoon um to go and interview with a company you know to do that for sure but i would not jump ship until you have another job solidified because you don't want your insurance yeah to to yeah i'm with your wife on

that that would be scary if if you had a gap between quitting this job and you know waiting i guess for another job so making sure that you have one that's secure um so that you can just move your health insurance over and and be on a new plan you know maybe with a new carrier or whatever that looks like with your new job job and making sure that it has benefits because, yeah, of your health situation, that is something that you're going to want set up for sure. How old are you, Steven? I'm 40 years old. We just had our first newborn baby. Congratulations.

How are you feeling? Oh, I'm feeling great. Good. Newborns are tough sometimes. They are. I like this idea. I like the idea of you looking for work if you're, you know, whether it's you're looking to increase your income or you're looking to increase your benefits. I like that. is really sit down and dream about where you want to be long term. And you know, not just pick

something because it's more money or not just pick something because of the benefits, but pick something because it's really something that energizes you. Like Ken Coleman would say something that gives you the juice and gets those juices flowing so that you're doing work that matters and work that really matters to you. We appreciate that call, Steve. And hopefully we were able to help you out there. Let's take another call. We got Rob in Denver, Colorado. What's going on, Rob? How can we help today? Hey, guys. How are you? Doing good. How are you? Good, good, good. Hey, quick question for you. My wife and I, we are in baby steps four, five, and six. And we're kind of planning ahead five years out where we want to be. And we would like to upgrade in a home.

And my question is to start planning to make sure that it's a good decision, that we have enough money. Is it best to pay towards the interest, I'm sorry, towards the principal that we have today? Or do we just pay the minimum amount and then take whatever we have left over and start saving up for another down payment? What would you guys suggest? I would continue to pay off your house because you're going to be building equity in that. So there's still going to be, you're going to see that money again. It'll just be an equity. And so I would do that. And because Rob, there's not like an actual specific, like, oh yeah, we're moving to that

house in six weeks. And you know, there's not like a very, very specific plan. You just know you want to upgrade. So while that dreaming is kind of still going and before the logistics are put into place, just keep throwing money at the house and just be paying that off. Yep, building that equity because when you guys do finally say, oh yeah, here's the house we want and you go through the process,

yeah, you'll have more equity in the house to roll over to the second house. Would you say the same, Jade? Yeah, I love that plan. And for another reason, I think that whenever you pay towards your current mortgage, it's forced savings. And because it's already gone into that whenever you pay towards your current mortgage, it's a forced it's forced savings.

And because it's already gone into that account, you can't touch it. So if you were just putting it into savings, right, instead of putting it on your mortgage, let's say you're stacking it up in a savings account. Look, Hawaii might be like, hey, hey, next summer. Yeah, I am. I always say cousin boo boo's destination wedding. It always comes at the worst possible time. Right when you've got right when you've got $10,000 saved cousin boo boo gets married in the Caribbean and you gotta go and you gotta go. And so that's why we would suggest go ahead and throw it to your current mortgage. And when you get ready to move, you're going to sell the house and you're going to have this nice little nest egg of equity there. So, you know, Rachel, that's the thing. You know, we think that we'll save this money and that we're like such good savers and we always do what we say we're going to do with our money. Doesn't always happen. I like to build in the accountability.

Yes. I like to bake it right in. It's forced accountability and not equity. It's a good question, Rob. It's a very good question. So that's what we would say to do. Anytime that you have money earmarked for something, if you can just build in that accountability so that you don't accidentally, quotes around accidentally, spend it on something else, especially when it comes to something as major as a home purchase, you definitely want to be able to do that because he's going to make money on it and he's going to have it ready for him and waiting when it is time. This is The Ramsey Show. Hey, you guys.

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You're listening to The Ramsey Show. We're here for you. Whatever you're going through, if it's money, if it's relationships, if it's career, hey, we're moms. If you're listening to the Ramsey show we're here for you whatever you're going through if it's money if it's relationships if it's career hey we're moms if you're a mom and you're just like uh at your wits end give us a call I'm Jade Warshaw this is Rachel Cruz give us a call at 888-825-5225 and today is a very special day yes it is I didn't know about this. I didn't know either. Today is Random Acts of Kindness Day, which I love this. February 17th. It says, if you're in the spirit of doing good, what better day to give back than on National Random Acts of Kindness Day, February 17th. Who knew? I know. So it started over 40 years ago in the San Francisco Bay Area. And a journalist is credited with coining the phrase practice random acts of kindness

and senseless acts of beauty. Love that. So that article was published and it sparked a kindness movement that spread to surrounding areas. And yeah, so it was just kind of a fun day because we love giving. Yeah, we talk about generosity a lot on this show. And it's part of the legacy that you leave. It's part of one of the reasons why we talk about being wise with your money and getting out of debt to have that margin

so that you can give, save and spend all the things. But giving is a it's a big part and everyone can participate and random the max of kindness that's right you don't have to spend a lot of money kindness is definitely contagious it doesn't have to be tons of money i mean you can do something for five dollars that's right when whenever somebody gives me one of those like five dollar starbucks gift cards yes it's like like it's just such a great way to be kind and you know we were talking about it last week i think john and i were on and we were just saying how with everything going on, inflation and like, you know, uncertain economies, it's really easy to kind of like focus our energy

on that as opposed to going, OK, how do I rise above this? And one of the best ways is to take the focus off of you and all of your like, like constraint and go be generous. That's right. Go do anything. And we should chat. Let's do a challenge. Jade.

I like this to everyone listening. Go and five bucks. It can just be $5. A random acts of kindness. And if you document it, put it on social hashtag the Ramsey way. Yes. And let's collect some of these stories and keep the random acts of kindness from over

40 years ago. Yes. Still in play. Let's do that. Hashtag the Ramsey way. And hey, like tag us in it. Like tag Rachel Cruz. Tag at Jade Warshaw.

George Campbell. Tag all of us because we want to see what you're doing. We want to share it on our social. We just want to make this thing contagious because like Rachel said, the whole point of living like no one else is so that later you can live and give like no one else. And I think that no matter where you are in the baby steps, there's always a place for generosity. Even if it's just a little bit, you can do this. So, oh, I love this. Random Acts of Kindness Day. Makes me feel even better. It does. It makes me feel great. February 17th. Don't forget it. Don't forget it. It makes me feel so

good. I want to take a call from Andrew in San Jose, California. What you got going on, Andrew? Hi, how are you both doing? Doing good. How are you? I'm doing good. First, thank you for taking my call and giving me a chance to help you with my question. Absolutely. Simply put, in the last four to six months or so, I got really caught up just inflating my lifestyle. And now I pretty much got myself in a, let's say, bad car situation that I'm really just trying to get out of. Oh, no. Tell us about it. What's going on?

So I got a new car that at the time, um, I felt like I could handle the monthly payments, but, uh, it kind of just feels like, you know, don't have much of a cashflow. And, uh, it's just, I really, at this point I'm so I'm sold on selling the car. And the question I have for you guys is like, is it better for me to buy a car and cash? So pay down my debt faster or finance something like a third of the costs. I'll keep forever. What do you think we're going to tell you? Buy a car in cash.

Yeah. Yeah. Why do you, I'm just playing devil's advocate here. Cause I want to see, I want to make sure that you know the reason why, cause you're feeling the pinch of this car payment. How much is your car payment, Andrew?

$1,100 a month. Ooh-wee. Yep, you are feeling that. Yeah, because, I mean, that's above average. How much do you make a year? I make about, last year I made a little over $100. This year I'm on track to make about $120. Okay. So you've had the car for three months,

and now you're thinking, whew, this was a bad idea. So to Jade's question, why do you think that we are going to suggest to pay for your next car with cash and not take out another loan? Well, so I no longer have a monthly payment and, you know, help me save up faster. Um, and I, and yeah, that's, that's pretty much my, to give you some, some background as far as why I was even thinking the other option, um, is really, uh, my, I, I've heard you guys give me advice for telling people, you know, go buy a $3,000, $5,000 car, write it, and then, uh,

help you pay down the cash. But I'm wondering if that, like, I'm worried that I'm going to get a car like that. And then, you know, three, six months, it's going to have a lot of payments. It's going to have a lot of fixes or something. And then I'm going to end up doing the same thing again. I think as long as you, I think, look, I've only driven used cars. I've never had a brand new car in my life. And I think as long as you do the research, check out the car facts, find out as much as you can

about the car and make a solid purchase. That's thing one. And then thing two, we always talk about having an emergency fund. Your emergency fund is there in case something crazy goes wrong. Right. There's that. And then your third level of protection is, you know, always having a sinking fund, just sitting there for regular car maintenance so that you're taking care of your vehicles and you're doing the things like the oil changes and the tires and changing the belts

and I don't know all the car terminology, but- You're doing great, Jade. You're selling me on it. You know, the rotator cuff, you know, whatever it's called. I don't know what that is. But as long as you're, the alternator, there you know the rotator cuff you know whatever it's called i don't know what that is but as long as you're the alternator there you go as long as you are taking care of your vehicle as long as you have your emergency funds set aside i think it's really easy to focus on those horror stories and let it talk you out of doing what's right but i know plenty of people who have bought new cars and they've had car troubles so i think that's just

kind of like that that we hit to make it. Here's gonna be your biggest, here's your biggest hurdle. Are you ready? Your ego. Okay, okay, that's it. Because you are sitting in a brand new, very expensive car.

What kind of car is it? It's a Tesla. Yeah. Tesla? It's a Tesla. This is close to Rachel's heart now. I will have a moment of silence with you, Andrew. I'm so sorry. But listen, you're going to it's going to hurt. Your ego is going to hurt. You've been driving around up to work, up with friends, going to dinner and your new Tesla. And now you're going to show up

in a camry that's right and your ego's going to take a hit but you know what guess what you're andrew's going to have money again okay andrew's going to have money and that's what you have to focus on andrew it's amazing how we just get so much of we were talking about the consumerism in the last hour but it's true i'm like man this this lifestyle feel and somehow we think if i just had a nice car uh if i just could go on this kind of trip if i gotta have this kind of house everything will be better i'm gonna feel better about myself because our cars have become our identity people look at your car yeah and they automatically you know they make they make assumptions, make assumptions. And so it takes a level of humility, Andrew, to say, you know what? I'm going to I'm going to help Andrew 10 years from now.

Yeah. Be in a whole lot better shape to go buy a new Tesla. My goal for you, Andrew, is to go back to a new Tesla. I would love for you. Yes. Love for you to be an everyday millionaire, be investing, have no debt, cash flow coming in. You're making great money.

And to be like, yeah, you know what? I'm going to go buy a new Tesla and you don't have to think twice about it. Come on, drive like no one else. So later you can drive like no one else. That's the goal, Andrew. That's the goal. But this thing is eating you alive.

So you're going to take a hit on it. You're probably going to be underwater by buying it brand new and selling it three months later. So you're going to take a small loan out for that difference. Put that in your debt snowball. Go buy a cheap car with $3,000, $5,000. It's fine.

And if it breaks down in six months, guess what? It doesn't lose value. Go sell it for $3,000 more. Put a few more. Go get another car, right? You can keep moving up in car. But list out all of your debts, Andrew.

Knock it all out. You have a great income. Get a solid emergency fund. And your peace of mind, Andrew, your peace of mind is going to be so different because you're actually going to have peace. You're not going to have stress. I love that. You got it. You got it, Andrew. I love that. But I'm so sorry. I'm so sorry. He has to amputate the Tesla. It's never an easy thing to do, but he's going to have peace because of it. Look, your car is not your status symbol. It does not say whether or not you are successful or not. What I'm looking at is,

do you actually have money, Rachel? That's right. This is The Ramsey Show. You're listening to The Ramsey Show. I'm Jade Warshaw joined by Rachel Cruz and we're taking your calls today about life and money. Go ahead and give us a call. The number is 888-825-5225. And if you're out there and you're looking to sell your house right now, trust me, it can be intimidating. I just went through this process. And since demand is still higher than supply, home prices are still rising regardless of what all the people say. Home prices are still rising regardless of what all the people say. Home prices are still rising and the buyers in this market are serious about finding a deal. That means you may have some tough decisions to make on a tight timeline. But look, you don't

have to sell your home alone and you shouldn't. Do not try this on your own, people. Trust me, it's important to work with an expert real estate agent who knows your local housing market inside and out and who will walk you through the selling process step by step. You need a real estate agent who's earned the right to be called Ramsey Trusted. And you can find one through our endorsed local providers program. Ramsey Trusted Pros who are are highly vetted, top tier agents, my team, and I trust. And I do trust. Let me tell you something. I got my real estate agent through Ramsey Trusted, and she was and still is incredible. Phenomenal. Mandy Linfesty. You heard it here first.

She's incredible. Love her. Everything that I'm talking about right now. They have what it takes to help you sell your home on your terms and for the best price. Wonderful. If you're ready to sell your home, get a Ramsey Trusted Pro in your corner. It's a free connect today. Just go to ramseysolutions.com slash agent to find one near you. That's ramseysolutions.com slash agent. You know, Jade, two nights ago, we had a VIP dinner in Indianapolis before our Building Wealth event. Yeah. And we had a group of Ramsey trusted real estate agents, tax

professionals. We had SmartVestor pros investing and some other people that we have contact with there in the area of Indianapolis. So we had a dinner. And we get to, you and I and the Ramsey personalities that were there, we get to mingle kind of before dinner. You sit at a table and just get to know these people. And I sat with a Ramsey trusted tax pro and a real estate agent. And they are just, those two specifically,

because I just had dinner with them. I'm like, they're heart for people. Yes. And to help you guys. That's why we recommend people in your corner, especially these very specific areas of your journey with money. Yeah. Because investing can be intimidating.

Selling your home can be intimidating. And buying a home, taxes, like all of these areas of your money. Having someone that's a professional that actually cares and loves what they do. Yes. I mean, they love what they do and getting to help people. So make sure to check this out because we vet these people. And we just want to we want you guys to have a level of financial peace and freedom with your money and having good people on your team.

That's right. It's so, so huge. It takes half. I mean, it takes the stress out of it. It does. Yes. When we were looking for a house here in Tennessee, my girl, my girl my real estate agent she came through she came all the way through so definitely get with a ramsey uh trusted pro in your area let's take a call let's take philip what's going

on philip from indianapolis indiana hey i was actually there last night at the building. Hey, let's go. Awesome. Love the energy in there. So I'm calling because I just, I feel like I need some encouragement. Maybe I'll kick in the pants or both. Oh, we can do that. Yeah, I'm 34. I've got $200,000 left in debt. I'm about $150,000 in student loans.

And then the rest is credit cards that I'm paying off a 401k loan. And my current employer offers $2 for every dollar that I put into my retirement. And so if I put in 500, which is what I've been doing, they add a thousand every single month. And so I put in 6,000 a year, they add 12,000. And I just have been struggling so hard giving that up because it's like a 200% return on investment immediately. But I have this debt looming over my head and I can't afford a down payment on a house. I can still rent it. And so I'm like, I just need to know that I'm going to be okay if I pause that for a few years, which is probably how long it's going to take me to get out of this $200,000 in the hole. What's your income right now, Philip?

I'm a pharmacist and a professor, so it's about $110,000. And I recently got married, I got a third kid on the way. Congratulations. Does your wife work? She's working part-time because she's in nursing school right now. So she's only making about $20,000 right now. Was that included in the $110,000? Or is that in addition to? No, it's about in addition to. So about $130,000 for the household currently.

All right. You know, of course, I'm going to always refer back to the baby steps because we know that this is a proven method. I mean, millions of people have used this not only to get out of debt, but to find financial freedom and go on to become baby steps millionaires. So we know that this method works. So let me precursor it with that. But yeah, that match is going to be there. That match is going to be there. And right now you need all of the money that you can to throw at your debt snowball so that you can get it done as quickly as possible. And here's the thing. When you're done getting out of debt, you're going to have so much more money to put towards retirement. You're going to be able to make up the difference. And what I would suggest doing, this is like my new favorite thing. If you're not using EveryDollar

Phillip, I would get on EveryDollar.com, EveryD dollar premium, and use the financial roadmap planner, because that's where you're going to plug in all these numbers. And you're going to be able to see like the actual math of if I'm putting this much per month towards my debt, how quickly can I have it paid off? That's thing one. But then it's also going to project out for you, Philip, what the final scenario is going to be. You're going to be able to find out when your three to six months is saved. You're going to be able to find out when you're going to become a Baby Steps millionaire. And it's so motivating. And trust me, once you plug the numbers in there, you're not going to be worried about the little bit of money that you're going to lose on this match because you're going to realize, oh my gosh, I'm going to be debt free

in like, I don't know, 24 to 36 months. Yes, I know. I was going to say, so pausing for three years, Philip, I'll talk you off the ledge. You're going to be fine. It's fine. Because guess what? You're going to press play and start investing again. And then like what Jade said, when you have that income, and you know, and you guys buy a house, you're going to be saving up for a down payment. You guys are going to be doing some really great financial moves that you're actually going to have the money for and the less stress. Because here's the other thing, Phillip, that you're not probably taking into account is what this $200,000 debt is doing to you guys. The stress, the lack of sleep. We talk about even within your body, your body knows that you are not safe when you don't have autonomy.

And when you owe student loans and MasterCard and all of this, other people have a say over your future. There's a level that you are still owned by them. And there is a true emotional, spiritual lifting that happens when you don't owe someone money. And that, Phillip, I don't care what employer does a match of any kind right like that level of just freedom and peace of mind that you guys don't owe anyone anything suddenly you may realize they don't want to switch jobs and you know what if that other employer has a three percent match wasn't as great as my other one but I have the freedom to create a life that I love, love it because I am not tied to these payments. So there is a, there is a mathematical reassurance that we'll give you on that side, that pausing investing for, for three years or whatever it is, you're going to

be okay. You're still young. You're fine. We would get the same advice actually, if you were 50, I mean, you know, it's the same advice. I think I needed to hear, you know, all of this is really helpful. And I think the clarity is something that I'm just not, I haven't seen yet. And so yesterday I started plugging in all these compound calculators and I'm like, oh, wow, this is going to be many millions. Because I currently have 180,000 in retirement already. And so if I did nothing, I would have over a million dollars. That's right. And I'm like, why can I not make the jump here to actually like do something about this debt? But I think the roadmap is actually going to be the most helpful thing for me because I'm someone who's got to see the numbers and know that this is heading in the

right direction. So I really appreciate, you know, the insight and encouragement because I've been looking for it for a little while and I haven't been able to get myself over the hump. So yes, appreciate you guys so much. Absolutely. We are so happy to help. And you know, that's a really good thing that he brings up, Rachel, because it happens all the time that people, you know, they're like, man, I don't want to stop my investing. I don't want to pause, but they don't think they're going to be okay. Can I tell, it took us seven and a half years of not investing. We didn't get to start investing until our mid-30s. You are going to be okay. Because you're going to invest one day.

You're going to invest. It's going to happen. I ain't got nothing else to do with my money, Rachel, but invest it. It's all going into there. And I'm like, I look at it and I don't go, oh man, what if I go, yeah, baby. That's right. This is happening. Everything they told me was going to happen is happening. So it is not too late for you.

I promise you that. This is The Ramsey Show. This is The Ramsey Show. We are on with Rachel Cruz, myself, Jade Warshaw. Guys, if you have questions about anything, I don't care what it is. It could be retirement. It could be inflation. It could be inflation. It could be meal planning.

Whatever it is that's on your heart and mind, give us a call today. The number is 888-825-5225. We want to discuss it because chances are whatever it is that's bugging you, it's probably not just bugging you. It's probably bugging a bunch of other people too. Whatever question you have, it's probably not just you. There's probably a lot of other people that have questions too. So give us a call right now. We're going to go to the phone lines. We've got Debbie in Huntington, West Virginia. What's going on in West Virginia, Debbie?

Hello. Thank you for taking my call. You're welcome. About a year ago, maybe a year and a half ago, I bought a car for my son. I co-signed for a car. It was a 2017 Veloster Turbo. Okay. And he drove it for about eight months making the payments. He has a good job, and he goes to work every day, so I was proud of him for that. He makes good money. Okay.

And apparently he didn't have the credit so they flipped it around and put it in my name and put him underneath me i didn't know that though so meanwhile on the way to vacation his transmission goes out and he's not with me so they tow it off and they told him it's going to be nine thousand dollars to fix it it. And it has under 100,000 miles on it. Okay. So it ends up that they said we didn't have any warranty, but it ends up, I had it towed back to home and they said, yes, you do have warranty on it and the transmission can be replaced. But so it was in limbo for like four or five months without being fixed because it took them forever to get it done.

Okay. And during that time, my son lost his license. How did that happen? Long distance driving to a girlfriend and he got tickets for speeding on the interstate. And so then he lost his license. Okay. How old is your son, Debbie? He's 21 now. Okay. so you spend the 9k to fix

the transmission right it didn't cost me anything it ended up being free oh okay the warranty okay paid eight i paid 18 for the car we still owe 15 and he really can't drive the car because he doesn't have a license. Is he still working? I don't, yes, he is. Okay. So where's the, how can we help you today? Well, when you lose your license, your insurance goes up. He's no longer allowed on our insurance because of that. Okay.

So he's got like 24 points. And then because of that, he's not going to be able to afford to make the house the car payment no and the insurance what's his name debbie what's his name it is jim jim okay i got i got a plan for jim and you debbie you ready yes i'd sell the car today for 18 it means you have three thousand left. I would give it to Jim if you guys are in a good position. No. It'll be turned around. We're going to owe more than we can

get out of it. You said it was worth $18,000 and you owe $15,000 on it. I paid $18,000. You paid $18,000. What's it worth, you think? One of the dealers said they'd give us like $10,000. I think if we sold it out right, we might be able to get more. All right. So Jim isn't going to like my plan as I continue down

this road. But I like it, Rachel. But Debbie, get rid of it, Debbie. And you're going to take a small loan of $5,000. You know what we call that, Debbie, around here? Stupid tax. And we've all done it. We've all been in positions where we think, why did I do that? Why did I co-sign? And now my name... Rachel, she just thought

she was being a good mom. She was just, she just thought she was doing the motherly thing. And so Jim, Jim is 21 and he's living at home.

And that's, you know, I'm not going to rag on that, but Jim is 21 and he's going to have. And that's, you know, I'm not going to rag on that. But Jim is 21 and he's going to have to learn. I have a long distance girlfriend. I have to now figure out my insurance is up because I drove fast and got multiple speeding tickets. I have lost my license. My insurance is up. Debbie, this is not your problem.

Nope. Jim has a lot of problems. And mama can't fix it. But Debbie doesn't. Debbie has a $5,000 problem that it but debbie doesn't debbie has a five thousand dollar problem that you're gonna have to just you're gonna pay but i would i would just i i just he's he's got to learn and and this isn't like a tough love like but for you debbie i'm looking out for you because i'm like man you couldn't you know you again good heart like you

said jade that the intention was good. But Debbie, I want you guys, I want you to be in a position that you are being wise with your money. And this isn't wise. In fact, what's the scripture about co-signing, Jade? To paraphrase the scriptures, it says that a person who co-signs is stupid. We're not calling you stupid, Debbie. The Bible did. No, I'm just kidding. But it is saying the act of doing that because you never know what's going to happen. And this is a very, very good teaching point for everybody listening right now. Sorry to put you on this pedestal, Debbie, but it's a great teaching segment because if there is any situation where somebody would

think I can co-sign for this person they're not gonna do me wrong it is mother to son right yeah it's the purest it's the purest relationship right there purest of intent but jim jim took you for a ride well and they flipped it on her yeah that when they pulled the credit they put her name on there so i'm like i don't want you liable debbie with this car like i don't trust that i don't i don like it. That's right. But that's what they do. And you know what, Debbie? And we're going to have to go to a break soon, so I can't get all this information from you. But depending on your situation, Debbie, if you are in a financial position, I'm thinking

you're not because you went and got a car loan for your son and all of that. But for some reason, if you did have, you know, some money to spare after this debt is cleaned up and you want to help jim out and say hey jim i will match you for your car you know you save three thousand and i and i will help you with three thousand to get you a six thousand you know like yeah if there's ways to help without enabling that's true and so if there is a type of plan like that you want to do you can but i want you debbie and a solid financial foundation meaning all of your debts paid off including this new five thousand dollar loan that you're going to have after the car is

sold you have an emergency fund in place like you are set up Debbie Jim is 21 he has his whole life to figure this out he sure does and and you know what I mean and you're and you're the mom so you're in the middle and of the of the age range so it's, I want you in a good position for retirement. Yes. And thinking large. So again, it was out of a good place. It was out of a good place. Of a mom's heart. And it just, it was the worst.

This is what happens though. The worst happens and people think it's going to be fine. And then it happens. So Debbie, I'm so sorry. Co-signing is the worst. Yeah, don't do it. We weren't calling Debbie stupid, but the Bible does say that it is stupid to sign assurance

or to co-sign for someone else. Can I tell you guys a secret live on air? When I was dating Sam, I quote, and big quotes, needed a new car. Yes, you did, Jade. I drove a Ford Taurus that had lots of special features. The heat didn't work. And Sam was like, you need a new car.

He took me and I have, of course, had terrible credit. He co-signed for my car. The dumbest thing ever. We were not even engaged. So let me tell you, I know something. Because here's the thing. If you're co-signing, it means that that person cannot get, they can't get the loan themselves, which means the bank knows they ain't got no money.

The bank knows they can't be trusted. That's the whole point of co-signing. So think about that for a minute. You're putting your neck on the line for something that, and banks, they would love to give you money. That's right. They're right there for you. Man, they'll give money to to they'll give money to anybody.

And if they won't give money to this person, that is saying something like that is your red flag to not sign for them. So if we're calling Debbie stupid, I'm calling myself stupid. And I'm not calling Debbie stupid at all. I'm just saying the scriptures got us on lock on the day. The scripture put us in a headlock on this one don't co-sign the loan now and i love what rachel said because when my kids get older and they get to driving age the plan is to buy cars in cash yes you know yeah they're gonna wreck them anyway i know they're gonna get dinged up they're gonna get scratched up yes i

for sure would never a brand new car no for well for a 16 year old no no girl no but don't you remember not in high school not until not yes in high school people would come rolling through with brand new cars yes yes they would oh yes they would don't do it no not worth it yeah the car thing it is uh oh it's the piece of debt that I'm like, man, the car loan. Borrowing money on something going down in value, all of it. Yes. Do not do it. Thanks for calling, Debbie.

It was a great call. It's something that we can all, all learn from. We've all done stupid things. The point is that we learned from it. And because we took that call, somebody is going to avoid the perils of co-signing. All right, folks, that does it for today's show. Be sure to join us next time. And remember this,

when it comes to changing your life and your money, you can tell me that you won't do it, but please, please do not tell me you can't. With Christ, all things are possible. This is The Ramsey Show. Hey, it's Rachel Cruz. If you love the show and want a deeper dive on your money journey,

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